22 Oct 10 - Bullish Gartley Pattern on NZD/USD - H1 Chart

A short term counter trend trade was set up this morning to go long on this pair on the completion of a bullish Gartley pattern. The reason why I would consider this a counter trend trade was for partly due to the completion of slightly stretched bearish Butterfly pattern seen on the D1 chart. With this in mind, trade management for this trade would be of a defensive stance where I will look to lock in small profits on my 1st batch while aiming at max the 0.618 retracement level of the AD swing no matter how promising the trade looks.


Attached is the D1 chart of NZDUSD which shows the completion of the bearish Butterfly pattern and thus this trade I am in is considered a counter trend trade. (It should be noted that once this pattern is completed, a bearish outlook is maintained for this pair and once a sell signal comes in, I will be more willing to sell this pair with a larger target profit in mind.)

Signals observed to go long:

1. A confluence of 3 harmonic ratios which points to a Gartley pattern completion - 0.786 XA @ 0.74562, AB=CD @ 0.74475 and 1.618 BC @ 0.74442.
2. A support seen on D1 Chart @ 0.74284.

Trade Details:

• Date: 21 Oct 10
• Time: GMT 22:19 (Exact entry trigger would have been at GMT 19:00 candle but I missed it and entered was price was still within range)
• Entry Price: 0.74675
• S/L: 0.74630 (37.5 pips)
• T/P: 0.75154 (47.9 pips) - 0.618 AD Swing

Trade Update:


1st Batch was closed on 22 Oct 10, GMT 05:00 at 0.74995, netting a profit of 32 pips while the 2nd batch was set to break.


2nd Batch was closed on 22 Oct 10, GMT 06:41 at 0.74877, netting a profit of 20.2 pips. The protective stop was triggered in this case.